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The payments landscape for community banks is changing rapidly as traditional payments converge with new instant payment systems and emerging cryptocurrencies. It is critical for Community Banks to maintain awareness of developments in the payments space to assess new opportunities, mitigate risks, and ensure that their payment strategy aligns with overall business plans.
Oct. 07, 2021
Central bankers and international securities regulators issued guidance on how financial market principles would apply to stablecoins.
Guidance: The joint guidance from the Committee on Payments and Market Infrastructures and the International Organization of Securities Commissions clarifies that international standards for payment, clearing, and settlement systems apply to stablecoin arrangements.
Impact: The paper, which has a comment deadline of Dec. 1, further demonstrates regulator concerns with stablecoins.
Next: The U.S. President’s Working Group on Financial Markets is expected to issue recommendations on regulating stablecoins as soon as this month. Meanwhile, the Federal Reserve Board is working on a separate report to seek public input on stablecoins and a U.S. central bank digital currency.
ICBA Position: ICBA recently expressed support for the Basel Committee on Banking Supervision’s work with banking supervisors to develop prudential regulations on cryptoasset exposures.
Background: Recent ICBA blog posts detail growing stablecoin risks to consumers and the financial system, how policymakers are responding, and what decentralized finance means for community banks.